Who is using bpos

Select personalised ads. Apply market research to generate audience insights. Measure content performance. Develop and improve products. List of Partners vendors. Business process outsourcing BPO is a method of subcontracting various business-related operations to third-party vendors.

Although BPO originally applied solely to manufacturing entities, such as soft drink manufacturers that outsourced large segments of their supply chains, BPO now applies to the outsourcing of services, as well.

Many businesses, from small startups to large companies, opt to outsource processes, as new and innovative services are increasingly available in today's ever-changing, highly competitive business climate.

Broadly speaking, companies adopt BPO practices in the two main areas of back-office and front office operations. Back office BPO refers to a company contracting its core business support operations such as accounting, payment processing, IT services, human resources, regulatory compliance, and quality assurance to outside professionals who ensure the business runs smoothly.

By contrast, front office BPO tasks commonly include customer-related services such as tech support, sales, and marketing. Business process outsourcing is on the climb, evidenced by the fact that in , the estimated global market size of outsourced services was BPO is referred to as "nearshore outsourcing" if the job is contracted to a neighboring country.

Such would be the case if a U. Companies are often drawn to BPO because it affords them greater operational flexibility. By outsourcing non-core and administrative functions, companies can reallocate time and resources to core competencies like customer relations and product leadership, which ultimately results in advantages over competing businesses in their industry.

BPO offers businesses access to innovative technological resources that they might not otherwise have exposure to. BPO partners and companies constantly strive to improve their processes by adopting the most recent technologies and practices. Since the U. BPO also offers companies the benefits of quick and accurate reporting, improved productivity, and the ability to swiftly reassign its resources, when necessary.

While there are many advantages of BPO, there are also disadvantages. A business that outsources its business processes may be prone to data breaches or have communication issues that delay project completion, and such businesses may underestimate the running costs of BPO providers. Another disadvantage could be customer backlash against outsourcing if they perceive this to be of inferior quality or at the expense of domestic employment. BPO is the abbreviation for business process outsourcing, which refers to when companies outsource business processes to a third-party external company.

The primary goal is to cut costs, free up time, and focus on core aspects of the business. The two types of BPO are front office and back office. Back-office BPO entails the internal aspects of a business, such as payroll, inventory purchasing, and billing. Front-office BPO focuses on activities external to the company, such as marketing and customer service.

There are numerous advantages to BPO. One of the primary advantages is that it lowers costs. Performing a certain job function internally costs a specific amount.

The obvious pros are that it saves you time and effort, which likely saves you money. There are only so many hours in a day, so you will want to focus the limited time you have on the work that makes you the greatest ROI return on investment on your best work.

By outsourcing your work, you allow yourself the opportunity to be more productive and grow your business faster. What happens if the person you're outsourcing to moves away?

What if they take your ideas and give them to other businesses you're competing against? We had an instance where we bought a lot of video marketing equipment and decided to outsource our projects to a video professional. That video professional is now reaching out to our competitors to ask if they would like the same work done. That means one of our competitive advantages is potentially lost if other real estate companies see the value.

BPO providers now support a number of services and help fill many gaps within companies. Some of the participating industries include healthcare, pharmaceuticals, energy, business services, retail and e-commerce, telecom, automotive, utility companies, banking, supply chain, capacity solutions, and asset management. In fact, the growth in BPOs has resulted in the emergence of subspecialties, including the following:.

Some KPO vendors support functions that are considered core in business, although they may not be core functions in the particular business that hires them. KPO firms offer more than process expertise; they may also provide business and domain-based expertise. KPOs may be capable of making low-level business decisions if they do not conflict with higher-level business policies, but those decisions may be undone easily.

LPO firms can draft patent applications and legal agreements, as well as perform legal research. Some LPO firms even advise clients. In-house legal departments usually retain LPOs.

Experienced paralegals using industry-standard databases do the work. RPO companies perform research and analysis work that supports business, investment, biotech, and marketing firms. Travel : This pertains to all the operations a business needs to support its travel logistics, from reservations to hotel and vehicle bookings.

Travel BPO saves money for the company because it cuts costs while increasing customer satisfaction. Airline and travel companies also engage in BPO for either front- or back-office process streamlining. For example, an airline could outsource its ticketing process. Back-office transactions : This includes check, credit, and debit card processing; collection; receivables; direct and indirect procurement; transportation administration; logistics and dispatch; and warehouse management.

IT and software operations : These technical support functions include application development and testing, implementation services, and IT helpdesk. For example, manual data entry can be replaced with automated data capture, increasing data intake and reducing cycle time.

Finance and accounting services : These functions include billing services, accounts payable, receivables, general accounting, auditing, and regulatory compliance. Human resource services : BPOs can help address workforce challenges. They can also cover payroll services, healthcare administration, hiring and recruitment, workforce training, insurance processing, and retirement benefits.

Knowledge services : These higher-level processes may include data analytics, data mining, data and knowledge management, and internet and web research, as well as developing an information governance program and providing the voice of customer feedback.

This was after steady growth of 4. For U. India in particular is a leader in BPO for the United States because its labor force is highly skilled, educated, English-speaking, and economical. Not only are these countries geographically disparate, they are different cultural entities as well, which may constitute a risk for the contracting company. In fact, hiring any outside vendor to perform business processes for your company comes with inherent question of efficiency and quality.

This is especially concerning because the industry has seen reported shortages in skilled workers, increased trade protectionism, and gridlocks due to political issues. Other risks include the following:. Security : In outsourcing, especially when information systems IS are involved, companies face communication and privacy risks. Security is more difficult to maintain when the business taking care of your IS is not in the same country, especially one with different security requirements.

Potential data privacy breaches and vulnerability disclosures are a real threat, particularly with the current prevalence of hacking. Underestimating the costs of services : Companies that employ BPO vendors often underestimate the running costs, especially in upgrades and contract renegotiation.

Other hidden costs include vendor selection, currency fluctuations, hardware and software upgrades, internal transitions, layoffs, and the potential decrease in individual worker productivity. Overdependence on service providers : Once a company designates a vendor for specific processes, the vendor becomes a part of the workflow.

The company can incur extraneous costs and decreased productivity when the vendor encounters problems or lapses in its work — for example, when the cost of hiring workers increases.

Vendors often replace veteran employees with less experienced workers to keep costs down, and quality suffers as a result. Communication issues : Language barriers can limit activities when your company hires individual service providers spread across the globe. This can result in delays in new processes and curbs on feedback from different departments, and it can potentially magnify current problems in your business operations. Further, customer-facing services may present language barriers to third-party vendors.

When outsourcing your processes and parts of your business, you face significant risks, depending on the type and structure of your company. For example, in very large segmented companies, outsourcing only the back data entry can carry a low risk. But for a small business that is reliant on BPO as part of its manufacturing, the risk increases.

Other possible risks associated with outsourcing include:. These robots operate on a user interface in the same way a human worker would. Due to the demand for increased cost efficiency and innovation, robots are becoming more widespread.

Robots cost between one-fifth to one-ninth of a full-time equivalent FTE worker in the United States, and about one-half of an FTE in a developing country. BPO vendors employ more than 3 million people in India, and more than 1 million people in the Philippines. BPO vendors are located all over the world, especially in developing nations with low income tax. South Africa has shown recent dominance in the BPO market, notably in call centers.

In the past five years, the BPO industry has exploded due to shifts in social media use and the concurrent demand for multichannel communication. Consumer behavior has changed too. Browsing social media is now the third most popular online activity, and 81 percent of the U.

Before , companies provided customer service through websites and by transferring calls via interactive voice response, and the BPO industry was primarily composed of call centers. BTO offers strategy consulting services, not only in-the-box, traditional supportive business functions. BTO consultants help businesses revamp their processes through outsourcing. In other words, BTO consultants review your business as part of their services and find the opportunities to implement BPO where it makes sense and is most beneficial for the company.

Executives may decide to outsource a business process through a BPO, such as customer support, for various reasons. A large, established business, in contrast, may decide to outsource a business process through BPO that they had already been performing for many years.

Analyses of running costs can show that an outsourced service provider, such as a contact center, could perform the job better and at a considerably lower cost since their organization is specifically geared up for it.

Depending on your organization, business process outsourcing can be a practical approach. Management consultants like to advise enterprise executives to identify business operations they can easily start outsourcing to an external provider through BPO.

Internal IT services is a very common one. Part of evaluating the pros and cons of BPO in this case is to decide if shifting that business task to an outsourced, third party service provider is strategically sensible for the company given the downsides. For example, IT helpdesk tickets such as employee login lockouts and new computer and network printer additions are very straightforward, however researching products for hardware upgrades and maintaining in-house ERP systems are much more complex tasks that a vendor would need significant investment in training.

If it does make sense to go BPO, a company has to of course go through the process of not just qualifying the most suitable provider for the work, but also shifting that work itself from in-house to that external provider which can take months or even years. Some common examples of BPO is outsourcing your information technology, human resources operations, or customer relationship management processes. Outsourcing inbound and outbound phone calls to dedicated contact centers or call centers is also one that most everyone is familiar with, and many businesses in the United States use these kind of BPOs to cut costs.

With business process outsourcing, you can theoretically put someone in charge of a complete functional area of your business, and fledgling startups to Fortune companies have outsourced various business processes and services through BPOs.

BPO cuts down considerably on costs on in-house labor, especially for hiring, staffing, and training, as well as for the workspace or office to accommodate local employees, such as customer support agents. Contact centers can take this burden off your shoulders, as it is their main job to hire, manage, and train personnel. Many outsourcing firms are physically located in developing countries and leverage lower-cost labor markets.

Process automation is one of the big benefits of BPO. Outsourcing customer support to a service provider through a BPO can of course save a companies time, allowing them to better focus on operations such as developing an amazing product and making sure their in-house people are regularly in communication with members of the supply chain instead of dealing with customers asking simple questions.

You will need to make some sacrifices if you decide to work with a BPO, but if the end result is considerably more cost efficient than having full-time staff members especially at scale , and it can be worth the trade-of in company culture and training.

Leading BPO firms work to improve and streamline methods by eliminating or reducing wasteful measures and may even help you raise the overall quality of work. Finally, it is important to note that business process outsourcing enables your company to use variable-cost models, such as fee-for-services plans, rather than fixed-cost models that you have to adopt when retaining local employees or service reps.

Non-core business tasks often remain in company backlogs. By outsourcing to a third party, your business can now clear those items. By outsourcing through a BPO your organization will have more time to concentrate on core competencies, deriving better ROI for your business. BPO implementation should carry various considerations, such as what roles are involved, who the business process impacts, and the way a business process is currently completed.